Example 1

For Assessment Year 2013-14

(A) Calculation of Income tax in the case of an employee below the age of sixty years and having gross salary income of:

(i) Rs. 1,50,000/-,

(ii) Rs.2,00,000/-,

(iii) Rs.5,00,000/-,

(iv) Rs. 10,00,000/-and

(v) Rs.20,00,000/-.

(B) What will be the amount of TDS in case of above employees, if PAN is not submitted by them to their DDOs/Offices:

Particulars

Rupees (i)

Rupees (ii)

Rupees (iii)

Rupees (iv)

Rupees(v)

Gross Salary Income (including allowances)

1,50,000

2,00,000

5,00,000

10,00,000

20,00,000

Contribution of G.P.F.

10,000

45,000

50,000

1,00,000

1,00,000

Computation of Total Income and tax payable thereon

Particulars

Rupees (i)

Rupees (ii)

Rupees (iii)

Rupees (iv)

Rupees (v)

Gross Salary

1,50,000

2,00,000

5,00,000

10,00,000

20,00,000

Less: Deduction U/s 80C

10,000

45,000

50,000

1,00,000

1,00,000

Taxable Income

1,40,000

1,55,000

4,50,000

9,00,000

19,00,000

(A) Tax thereon

Nil

Nil

25,000

1,10,000

4,00,000

Add:

(i) Education Cess @ 2%.

(ii) Secondary and Higher

Education Cess @1%

Nil

Nil

Nil

Nil

500

2200

250

1100

8000

4000

Total tax payable

Nil

Nil

25,750

1,13,300

4,12,000

(B) TDS under sec. 206AA in case where PAN is not furnished by the employee

Nil

Nil

90,000

1,80,000

4,12,000

Example 2

For Assessment Year 2013-14

Calculation of Income Tax in the case of an employee below the age of sixty years having a handicapped dependent ( With valid PAN furnished to employer).

S.No.

Particulars

Rupees

1

Gross Salary

3,20,000

2

Amount spent on treatment of a dependant, being person with disability (but not severe disability)

7000

3

Amount paid to LIC with regard to annuity for the maintenance of a dependant, being person with disability( but not severe disability)

50,000

4

GPF Contribution 25,000

5

LIP Paid

10,000

Computation of Tax

S.No.

Particulars

Rupees

1 Gross Salary

3,20,000

Less: Deduction U/s 80DD (Restricted to Rs.50,000/- only)

50,000

2 Taxable income

2,70,000

Less: Deduction U/s 80C (i) GPF Rs.25,000/-

(ii) LIP Rs. 10,000/- = Rs.35,000/-

35,000

3

Total Income

2,35,000

4

Income Tax thereon/payable

3,500

Add:

(i). Education Cess @2%

(ii). Secondary and Higher Education Cess @1%

70

35

5

Total Income Tax payable

3,605

6

Rounded off to

3,610

Example 3

For Assessment Year 2013-14

Calculation of Income Tax in the case of an employee below age of sixty years where medical treatment expenditure was borne by the employer ( With valid PAN furnished to employer).

S.No.

Articulars

Rupees

1

Gross Salary

3,00,000

2

Medical Reimbursement by employer on the treatment of self and dependent family member

30,000

3

Contribution of GPF

20,000

4

LIC Premium

20,000

5

Repayment of House Building Advance

25,000

6

Tuition fees for two children

60,000

7

Investment in Unit-Linked Insurance Plan

20,000

Computation of Tax

S.No.

Particulars

Rupees

1

Gross Salary

3,00,000

Add: Perquisite in respect of reimbursement of Medical Expenses In excess of Rs. 15,000/- in view of Section 17(2)(v)

15,000

2

Taxable income

3,15,000

Less: Deduction U/s 80C

(i) GPF

Rs. 20,000/-

(ii) LIC

Rs. 20,000/-

(iii) Repayment of House Building Advance

Rs.25,000/-

(iv) Tuition fees for two children

Rs. 60,000/-

(v) Investment in Unit-Linked Insurance Plan

Rs. 20,000/-

Total =Rs. 1,45,000/-

Restricted to Rs. 1,00,000/-

1,00,000

3

Total Income

2,15,000

4

Income Tax thereon/payable

1,500

Add:

(i). Education Cess @2%

(ii). Secondary and Higher Education Cess @1%

30

15

5

Total Income Tax payable

1,545

6

Rounded off to

1,550

Example 4

For Assessment Year 2013-14

Illustrative calculation of House Rent Allowance U/s 10 (13A)in respect of residential accommodation situated in Delhi in case of an employee below the age of sixty years (With valid PAN furnished to employer).

(b) Expenditure of rent in excess of 10% of salary (including D.A. presuming that D.A. is taken for retirement benefit) (1,44,000-35,000) = 1,09,000

(c) 50% of Salary(Basic+ DA) = 1,75,000

1,09,000

Gross Total Income

3,81,000

Less: Deduction U/s 80C

(i) GPF Rs. 36,000/-

(ii) LIC Rs. 4,000/-

(iii) Investment in Unit-Linked Insurance Plan Rs. 50,000/-

Total =Rs.90,000/-

90,000

3

Total Income

2,91,000

Tax payable on total income

9,100

Add:

(i). Education Cess @2%

(ii). Secondary and Higher Education Cess @1%

182

91

Total Income Tax payable

9,373

Rounded off to

9370

Example 5

For Assessment Year 2013-14

Illustrating valuation of perquisite and calculation of tax in the case of an employee below age of sixty years of a private company in Mumbai who was provided accommodation in a flat at concessional rate for ten months and in a hotel for two months ( With valid PAN furnished to employer).

Example 6

For Assessment Year 2013-14

Illustrating Valuation of perquisite and calculation of tax in the case of an employee below the age of 60 years of a Private Company posted at Delhi and repaying House Building Loan ( With valid PAN furnished to employer)

S.No.

Particulars

Rupees

1

Salary

3,00,000

2

Dearness Allowance

1,00,000

3

House Rent Allowance

1,80,000

4

Special Duties Allowance

12,000

5

Provident Fund

60,000

6

LIP

10,000

7

Deposit in NSC VIII issue

30,000

8

Rent Paid by the employee for house hired by her

1,20,000

9

Repayment of House Building Loan (Principal)

60,000

10

Tuition Fees for three children (Rs. 10,000 per child)

30,000

Computation of total income and tax payable thereon

S.No.

Particulars

Rupees

1

Gross Salary (Basic+DA+HRA+SDA)

5,92,000

Less: House rent allowance exempt U/s 10 (13A)

Least of:

(a). Actual amount of HRA received. :Rs. 1,80,000

(b). Expenditure on rent in excess of 10% of salary (Including D.A.)assuming D.A. is including for retirement benefits (1,20,000- 40,000) :Rs. 80,000

(c). 50% of salary (including D.A) : Rs. 2,00,000

80,000

2

Gross Total Taxable Income 5,12,000

Less: Deduction U/s 80C

(i). Provident Fund : 60,000

(ii). LIP : 10,000

(iii). NSC VIII Issue : 30,000

(iv). Repayment of HBA : 60,000

(v). Tuition Fees (Restricted to two children) : 20,000

Total : 1,80,000

Restricted to 1,00,000

1,00,000

Total Income

4,12,000

Income Tax thereon/payable

21,200

Add:

(i) Education Cess @ 2%

(ii) Secondary and Higher Education Cess @ 1%

424

212

Total Income Tax payable

21836

Rounded off to

21840

Example 7

For Assessment Year 2013-14

A. Calculation of Income tax in the case of a retired employee above the age of sixty years but below the age of 80 years and having gross pension of:

i. Rs. 4,50,000/-,

ii. Rs. 8,00,000/-,

B. What will be the amount of TDS in case of above employees, if PAN is not submitted by them to their DDOs/Offices:

Particulars

Rupees (i)

Rupees (ii)

Gross Pension

4,50,000

8,00,000

Contribution of P.P.F.

70,000

70,000

Computation of Total Income and tax payable thereon

Particulars

Rupees (i)

Rupees (ii)

Gross Pension

4,50,000

8,00,000

Less: Deduction u/s 80C

70,000

70,000

Taxable Income

3,80,000

7,30,000

Tax thereon

13,000

71,000

Add:

(i) Education Cess @ 2%.

(ii) Secondary and Higher Education Cess @ 1%

260

130

1420

710

Total tax payable

13,390

73,130

TDS under sec. 206AA in case where PAN is not furnished by the employee

26,000

1,46,000

Example 8

For Assessment Year 2013-14

A. Calculation of Income tax in the case of a retired employee above the age of 80 years and having gross pension of:

iii. Rs. 4,50,000/-,

iv. Rs. 8,00,000/-,

B. What will be the amount of TDS in case of above employees, if PAN is not submitted by them to their DDOs/Offices:

Particulars

Rupees (i)

Rupees (ii)

Gross Pension

4,50,000

8,00,000

Contribution of P.P.F.

70,000

70,000

Computation of Total Income and tax payable thereon

Particulars

Rupees (i)

Rupees (ii)

Gross Pension

4,50,000

8,00,000

Less: Deduction U/s 80C

70,000

70,000

Taxable Income

3,80,000

7,30,000

Tax thereon

Nil

46,000

Add:

(i) Education Cess @ 2%.

(ii) Secondary and Higher Education Cess @ 1%

920

460

Total tax payable

Nil

47,380

TDS under sec. 206AA in case where PAN is not furnished by the employee